You can’t afford to have money slip through your fingers on random stuff. You can’t afford to waste your time and emotional energy on worrying about making it to the next paycheck, wondering how you will ever get ahead and save something for the future. Retirement? A college fund the for the kids? A paid-for vacation? You can barely keep up with your car payment, much less even think about having “extra” money lying around.

All you know is you feel trapped in this vicious paycheck-to-paycheck cycle, where one illness, one car accident, or one job layoff could send you spiraling toward bankruptcy. Every other Friday is respite when money is deposited into your account, while the weeks in-between drag on as bills, groceries, and unanticipated needs threaten to drain every cent. The bank account roller coaster has to stop.

Until now, it’s been easier to bury the stress, thanking your lucky stars that you didn’t overdraft (again), but something about today made you say, enough. This is ridiculous. I deserve better. I want better.

I’m here to tell you that you’re right. It is ridiculous. You do deserve better. You can have better. Don’t ignore this feeling. Don’t let this moment of rage-induced clarity go unexplored. Act on it. Because nothing will change until you do. You can’t take it anymore. So don’t.

As your coach, here’s a little tough love: better takes work. Different results follow different choices, sacrificial choices, but the sacrifice is infinitely small compared to the measure of peace and financial gain you will receive in return. It’s worth the work!

There isn’t a quick tip, a weird trick, or a magical formula that will turn your situation around. Oh, there are lots of awesome tips and tricks that I love, but we need to talk fundamentals first. An app that saves a few cents here and there isn’t going to get you to retirement. You need a plan.

Here it is.

Step 1: Dream. What do you want your life to look like? Do you long to visit Scandinavia? Take up cake decorating as a hobby? Kayak on every continent? Stay home with your children? Retire at age 50? The things you want to do are important, but even more important is the way you want to live. Are you okay settling for what’s normal, living paycheck to paycheck? (If you’re reading this I would guess the answer is no.) Do you long for money to be one component of life that you manage with ease instead of a primary stress factor that feels all-consuming? Do you want a life marked by contentment, generosity, and rich experiences? These are the questions you need to think about, answer, and write down. Having these questions answered in written form is helpful when you need that extra emotional boost to remind yourself why you’re doing the hard work.

Step 2: Face the numbers. It’s time to be brutally honest with yourself. In my coaching practice, this exercise always—I mean 100% of the time without exception—identifies the mathematical part of the problem. This is how you diagnose what’s going on. Take your expenses and add them up on this starter budget form. It’s okay to guesstimate a little but remember this is not the time to be in denial and paint a rosy picture. Try to account for everything, including how much you spend on gifts, haircuts, books, travel, subscriptions, everything. This will tell you immediately if you’re overspending—or in some cases, spending within your means but living frugally in fear (that was me). It will also tell you if you’re saving appropriately for expenses that seemingly appear out of thin air (car repairs, school supplies, the dog’s vaccines, things like that), or if you need to set some money aside.

Step 3: Commit to stop using debt. This means no more credit cards, new car loans, or student loans. Love yourself enough to deepen your sense of happiness without buying more than you can afford. Using a cash-based spending system can really help you stay on track.

Step 4: Write a budget. This is a written plan for the month ahead. One very important clarification: accounting for what you have already spent is not a budget. A budget is where you theoretically spend your money on paper before the paycheck even hits your account. Even (perhaps especially) millionaires have budgets. It’s not about how much you make, it’s about how you manage it. When you write the budget, cover your basic needs first (food, shelter, transportation, and necessary clothing). Give next, then save, and then you can spend the rest on discretionary items that are “wants.” (Check out Why I Give Before I Save).

Step 5: Identify your wealth-building step. I teach Dave Ramsey’s Seven Baby Steps and cannot say enough about this basic outline for building wealth (it’s a big reason I became a Dave Ramsey-trained coach). If you work through the steps, you will succeed, simple as that. If you’re not familiar with the steps, you can read my Guide to Identifying your Wealth-Building Step. Knowing what step you’re on will inform how you need to prioritize savings. If you need a starter emergency fund, every spare dollar needs to go to that $1000 goal. If you’re in debt, you will benefit from focusing on paying it off. If you have no debt and a sizeable emergency fund, it’s time to put 15% of your income into tax-advantaged retirement accounts. As you can see, your budget is going to shift depending on what step you’re on, and it provides both focus and fuel for achieving one wealth-building goal at a time.

If you feel a little overwhelmed right now, it’s okay. Sit back, take a deep breath or two, and know that you have already begun the process of getting those financial ducks to start cooperating! Once you take the time to dream and have a clear idea of what you want to get out of this process, you can face the numbers and make some adjustments so that you are working toward a tangible, wealth-building goal. The budget is the mechanism to keep you on track, and staying away from debt will keep you moving in the right direction. Don’t waste another day settling for less. Better is waiting for you.

Do I pay the high interest loan before the student loans? What if I owe the IRS? Should I get the car repaired or pay the credit card? Should I take advantage of my employer’s 401K match or pay cash for graduate school? How much do I need to save for retirement? How do I balance long-term goals and short-term savings?

Life doesn’t fit into a neat little box, no matter how hard we try, and to make matters more complicated, it seems there are twenty different answers on the internet for every one financial scenario. It’s like trying to find the best cheesecake recipe when you’ve never made a cheesecake. There’s no reference point. And this a little more important than a cheesecake.

So instead of prescribing an intricate scheme that looks nice on Pinterest but doesn’t translate to real life, I want to take you through the Seven Baby Steps. Designed by Dave Ramsey, the Seven Baby Steps is your surest, fastest way to building (and keeping) wealth. Keep in mind, this is not a get-rich-quick kind of deal, but a principles-based plan that—if you follow it without skipping steps—will allow you to build wealth over time.

Baby Step 1: Save $1000 as a starter emergency fund. Save up $1000 as quickly as humanly possible and put it into a separate savings account, preferably a money market account where you’ll get a little interest. Order some checks, and your starter emergency fund is all set. This must be complete before moving to step two, or you will almost certainly get stuck in a debt cycle whenever a minor emergency pops up.

Baby Step 2: Pay off all non-mortgage debt. Make a list of debts, starting with the smallest balance and ending with the highest balance, regardless of interest rate. Pay the minimum payments on everything except for the smallest debt. As you cross off each debt on the list, add the payment from the previous debt onto the payment for the next one.

Baby Step 3: Complete your emergency fund, which consists of three to six months of living expenses. Whether three, six, or somewhere in-between, you’ll want to have several months of living expenses set aside (not your whole paycheck, just what will cover basic expenses). This is like an insurance policy that creates a buffer between you and any life events or significant financial emergencies.

Baby Step 4: Contribute 15% of your gross income to retirement accounts. This one can be painful to wait for, especially if your employer offers a 401K match and you’re still in Step 2, but trying to manage debt and invest is counterproductive to wealth-building. It’s like trying to plant a garden over a mess of weeds. You won’t be able to harness the power of your biggest wealth-building tool—your income—when you’re strapped with debt. Clean up the debt first, then focus on investing.

Note: Steps 4, 5, and 6 are done concurrently.

Baby Step 5: Save for college. If you have little ones, they will most likely go to college or trade school, and that takes a lot of money. The earlier you can start saving, the better. Even if you aren’t able or do not plan cover your child’s entire tuition bill, there are some excellent (and some terrible) tax-deferred investment options to help your future scholar. Take caution: don’t become overwhelmed by rising tuition costs and sacrifice Step 4. Retirement is going to happen and there are only so many ways to pay for it. However, there are several ways to fund college that don’t involve going broke.

Baby Step 6: Pay off the house early. Can you imagine what it would be like not to have a house payment? Amazing hardly begins to describe it. That’s so much money! Better yet, it is possible to accomplish: those who follow this plan pay off their house in an average of seven years.

Baby Step 7: Build wealth and give generously! Because at this point, there’s nothing else to do! I love the focus on giving here, because building wealth isn’t the same as wealth hoarding. What we do with what we have matters more than how much we have.

Life will always be complicated, but having a plan will help you stay focused and on-track. The Seven Baby Steps is a tried-and-true process for staying out of debt and building wealth.

Hi there! I’m Lauren.

I'm a Dave Ramsey-trained financial coach, wife to Kyle, mom of twin girls, and a follower of Jesus. I believe that personal finance shouldn't be complicated or overwhelming, and that with a plan, you CAN achieve your financial goals.